Idea Of Demonetisation Wrong, Says Rajiv Bajaj

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HIGHLIGHTS

  • Bajaj said that the execution of demonetisation should not be blamed
  • Sales of two-wheelers has slumped post demonitisation
  • Bajaj also commented on the Qute quadricycle not being sold in India

Rajiv Bajaj, Managing Director, Bajaj Auto India criticised the idea of demonetisation in India saying that the idea itself was 'wrong'. He also mentioned that it was incorrect to blame only the execution. The ban on 86% of the total currency worth ₹ 15.55 trillion in circulation impacted economic activity across sectors with the consumption-driven ones being the most affected. Notably, the two-wheeler sales took a beating and we told all about it to you already. While most of the companies are still trying to recover from the impact of demonetisation, industry data releases over the last two months has shown how much the industry has been affected.

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"If the solution or the idea is right, it will go like a hot knife through butter. If the idea is not working, for example demonetisation, don't blame execution. I think your idea itself is wrong," Bajaj said at the annual Nasscom Leadership Forum.

Bajaj Auto's total domestic sales, including those of two-wheelers as well as three-wheelers, were down 16 per cent to 1,35,188 units in January 2017 from 1,61,870 units sold during the same period last year. It was in January that the company launched its most powerful motorcycle, the Dominar into the Indian market and yes, had it not been for demonitisation the result would have been a better one, though the bookings for the bike are coming in thick and fast.

Bajaj Auto saw its domestic bike sales contracting by 11 per cent at 1,06,665 units as against 1,20,322 units in the same month a year ago. Industry body SIAM had said in November that two-wheeler sales were at 12,43,251 units as against 13,20,552 in the year-ago month, down 5.85 per cent.

Motorcycle sales were also down 10.21 per cent at 7,78,178 as compared to 8,66,696 units in December 2015. However, he seemed most upset about the fact that the company's quadricycle - Qute- is being sold across the world namely Europr, Asia and Latin America but not in India. The launch of the quadricycle has been delayed because the company is still awaiting permissions from the government. Taking a dig at the 'Make in India' initiative, Bajaj said, "If your innovation in the country depends on government approval or judicial process, it will not be a case of 'Made in India', but 'Mad in India'. After five years, we are still waiting for permission to sell our four-wheeler in the country. This (India) is the only country that has not given us permission to sell this vehicle. Because, for some reason, it thinks if four-wheeler is worse, let people continue on three-wheeler,"

The general argument in favour of quadricycles has been that they do not have enough power to go fast and hence are incapable of reaching high speeds, thus safer. In fact, the Euro NCAP also states on its website that these vehicles do not have to conform to the more stringent safety tests that apply to cars. Mind you, quadricycles are prone to damage if it's hit by another car and that may cause injury to the occupants and this is where India does not have a regulation in place.

Bajaj said, "We feel people should either walk, cycle or use a two-wheeler. Cars are too big, too fast. they pollute, they congest and kill all of us on two-wheelers. People say two-wheelers are dangerous, My submission is two-wheelers are dangerous only when hit by a car,"

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